You’re careful about what you spend and how you invest. But are you also careful about where you donate your hard-earned dollars?
Most people aren’t. Most take a somewhat haphazard approach to giving. They write checks to organizations that have a good mission or charismatic leader. They donate to charities their friends and family members support. They give to causes they read about or hear advertised on TV that tug at their heartstrings. They respond to the latest disaster or crisis in the news. That’s not a bad thing, it’s just not the best approach if you really want to make an impact.
If you want to be a good steward of your money, you need to be intentional about what you spend, how you invest, and where you donate. Begin by establishing an annual review process for your philanthropy so you can strategically plan your giving once a year and make small tweaks as necessary.
I advise adopting an investor mindset to philanthropy and creating a portfolio of giving. Your portfolio should be dedicated to causes you are passionate about that are being addressed by the most effective organizations you can find. When deciding where to donate, ask yourself if your approach is one of charity or philanthropy? Charity is typically an emotional response to a need. Philanthropy takes a strategic approach to problem solving with the goal of eliminating the issues that necessitate the need for charity.
As long as donors continue to give based on emotion alone, there is no incentive for the nonprofit community to focus on effectiveness and problem solving. But that’s beginning to change as funders become educated and informed. Your impact can be even greater when you not only address needs but also effect change and encourage greater accountability from the nonprofit community. That’s what I want for you.
This more intentional approach to philanthropy has many adjectives associated with it: strategic, effective, result-oriented, outcome-oriented. What it means is that before you make a donation, you ask some important questions about what, how, and to whom you want to give. This does not mean you have to become an expert. There are many intelligent, hard-working, energetic, dedicated, compassionate individuals working diligently to solve our most pressing social issues. You just have to understand what issue you want to focus on and then find the organizations that best address it and support their work.
It’s about the difference you want to make in the world and who you believe has that same conviction and can carry it out effectively. So do your research, and if you can, get out into the field to meet those doing the work. Then make your decision. You will gain more knowledge about the issues and maybe even get some first-hand experience. And you will become a more intentional, impactful giver.
I advise providing unrestricted (not program specific) funding for one year initially. Make your donation and get out of the way. Let the experts do their work. Offer advice and support only if asked. Don’t expect them to adjust their strategy or programming based on what you think will work better. If you don’t trust them, you shouldn’t fund them. It’s that simple.
Monitor their progress using the measurements they use. If after the first year you continue to be impressed with the organization, by all means provide additional, longer-term funding and develop a mutually beneficial partnership with them.
You’re just hoping to have enough to get your kids through college and retire before you turn eighty, but you have a heart for giving and are passionate about your cause. Can you still be a philanthropist?
It doesn’t matter who you are, what you make, or how much you have in savings. Everyone has something to give. Sometimes we hear about people donating millions and even billions to philanthropy, and we think our small donation means nothing. Does your $25, $100, $1,000, or even $10,000 make a difference? You bet it does! The nonprofit community needs the support of donors at all giving levels, so never think what you give is not enough. It’s not about how much you give, it’s about why and how you give.
That way, you can consolidate your giving and have a greater impact. It costs an organization to process your donation, so a gift of less than $25 is probably not making much of a difference. You will have more impact by making larger donations to fewer organizations.
If you don’t have a lot to give monetarily, perhaps you can give of your time and talent. Nonprofits can’t operate without a cadre of volunteers. Don’t discount the value you bring by sharing yourself.
If you have a desire to give, you are a philanthropist. If you want to share yourself in service to the world, you are a philanthropist. If you want to make your AWE-thentic Impact, you are a philanthropist. No more wondering if you have something to give. We need you!
AWE Partners is a boutique advisory firm that educates women on how to give, invest, and shop for impact from a place of authenticity. The firm works closely with female entrepreneurs who desire to bake mission into their life and business for more passion, purpose, and profit!
Lis is passionate about educating women on allocating their philanthropic dollars and investments for maximum impact. Additionally, she encourages them to discover meaning through sharing their gifts and talents in service to the world, a practice she calls “AWE-thentic Impact.” Lis is particularly focused on issues related to the empowerment of women and children, environmental sustainability, and animal welfare.
Lis holds an MBA from the Kellogg School of Management at Northwestern University and a BS in Finance from the University of Illinois at Champaign-Urbana. She is the author of The Gutsy Guide to Giving: Your Journey to AWE-thentic Impact. You can learn more at her website…